The state of Georgia offers many tax credits to businesses. These credits are sometimes overlooked or not fully understood by many tax preparers. If your company pays Georgia income taxes, including pass-through entities, these tax credits could save you money. Here is a brief overview of some of the tax credits your company could benefit from:
The Georgia Retraining Tax Credit is available to businesses with operations in Georgia that train Georgia resident employees on new technology. This credit is 50% of the direct costs of training, up to $500 per eligible employee, per training program, per year. Beginning in 2009, the credit cannot exceed more than $1,250 per employee. Best of all, any unused tax credit may be carried forward 10 years.
The Georgia Job Tax Credit is available to Georgia businesses engaged in the following six industries: Manufacturing, Telecommunications, Boradcasting, Warehousing & Distribution, Research & Development, Processing (data, information, software), and Tourism. The job tax credits range from $1,250 to $4,000 per new job created for each year and is dependent on the geographic location of the new job. This tax credit is taken over a five year period, and any unused job tax credits may be carried forward 10 years.
A Georgia Investment Tax Credit is available to Georgia businesses engaged in either of two industries: Manufacturing or Telecommunications. The businesses also must have operated a facility in Georgia for at least three years. This investment tax credit requires a capital expenditure of at least $50,000 that is directly related to a manufacturing activity or to providing telecommunication services, and is also dependent upon geographic location. The Georgia Investment Tax Credit is limited to 50% of the income tax liability each year and is taken in the year following the year that the minimum investment is made. This credit may also be carried forward 10 years. The process required to obtain this credit is complicated; therefore, you should consult with your tax preparer.
The Qualified Education Expenses Credit is available starting after January 1, 2008. Georgia will allow a corporation to claim an income tax credit by donating money during the tax year to a select number of student scholarship organizations. The credit is equal to the lesser of the actual amount expended or 75% of the corporation’s income tax liability. The credit cannot exceed the taxpayer’s income tax liability; any unused credit can be carried forward against the taxpayer’s next five year’s tax liability and no credit carryback is allowed. The aggregate amount of the credits allowed cannot exceed $50 million per tax year and the Commissioner of Revenue must allow the credits on a first come, first served basis. The Commissioner must preapprove or deny the requested amount of contributions that the taxpayer intends to make to the student scholarship organization. In addition, the use of this credit prevents electronic filing of the income tax return due to substantiation requirements. Your should consult with your tax consultant if you would like to find out more about this credit.
These are just a few of the tax credits available for Georgia businesses. They certainly can provide more of an incentive to continue with an idea or project. If you are interested in learning if your business qualifies for any of the tax credits named above, please contact Henssler Financial at 770-429-9166 or experts@henssler.com.